DIFC registers another strong growth period

The Dubai International Finance Centre (DIFC) has registered another strong growth performance in the first half of the year as company registrations rose 32% y/y. This led to a net gain of 25% in active companies to 7,700. The number of hedge funds operating in the DIFC was up 72% to 85 by the end of June while there was a 19% rise in wealth management firms and family business entities were up 73%. This robust performance is indicative of a number of trends, not least the rise in high-net-worth individuals moving to Dubai and the financial ecosystem which is developing to support their finances. The persistent increase in new firms will also support the real estate sector, with prime offices having already seen capacity levels of over 95%. Further, with financial and insurance services accounting for around 12% of Dubai’s GDP, a strong performance for the DIFC is supportive of headline GDP growth for the emirate and the wider UAE.

India recorded industrial production growth of 1.5% y/y in June. This marked a slowdown from the upwardly revised 1.9% seen in May and was also short of the predicted 2.2%. Industrial production growth has averaged 3.0% y/y over the first half of 2025. The slowdown was driven by an 8.7% y/y decline in mining production and a 2.6% fall in electricity production which offset gains seen elsewhere – manufacturing was up 3.9%, capital goods production rose 3.5%, and consumer durables was up 2.9%.

CPI inflation in Bahrain was at -0.4% y/y in June, a smaller fall compared with the May print of -1.0%. Prices for food and non-alcoholic beverages was down 3.6% m/m as the sharp rise seen in 2024, prompted by shipping disruption, unwound.

Today’s Economic Data and Events

18:00 US Conference board consumer confidence index, July. Forecast: 96.0

18:00 US JOLTS job openings, June. Forecast: 7.55mn

Fixed Income

• There was little movement in USTs for want of any major news developments or data releases yesterday, with markets waiting to see the outcome of Wednesday's FOMC meeting. Yields on the 2yr were up by less than 1bps to 3.9255% while the 10yr closed 2bps higher at 4.4098%.

FX

• The US dollar index closed up 1.0% against its basket of peers yesterday for a third straight session of gains. Much of this came against the Euro as the trade deal announced between the two on Sunday night was interpreted as negative for the single bloc currency. It closed down 1.3% at 1.1589.
• Other majors also closed down against the USD with GBP down 0.6% to 1.3356 while JPY weakened 0.6% to 148.53.
• EGP had a positive day as it closed 0.6% stronger against the dollar to 48.7900, its lowest level since November.

Equity Markets

• US equity markets were somewhat mixed but generally quiet on Monday as markets wait to see the big data releases and Fed decision later in the week. The Dow Jones closed down 0.1%, the S&P 500 closed flat, while the NASDAQ ended the day 0.3% higher.
• Locally, the ADX added 0.2% while the DFM gained 0.3%. In Saudi Arabia the Tadawul closed 0.7% lower.

Commodities

• Oil prices saw sharp gains yesterday after US President Donald Trump told reporters in the UK that he would be shortening the deadline for Russia to come to the table on Ukraine to 10-12 days, rather than the 50 he had previously announced. Brent futures closed up 2.3% at USD 70.0/b, while WTI rose 2.4% to USD 66.7/b.
• At a panel meeting yesterday, OPEC+ urged those countries that had been overproducing according to the terms of the production agreement to draw up a plan for compensating for this. The body is set to meet this weekend to announce how many barrels would be brought back onto the market in September, with expectations that it will be an extra 548,000 b/d once again.